Solution-Calculate your expected return on the stock

Calculate your expected return on the stock

Reference no: EM132957376

Question - You purchase 300 common shares in a publicly traded company at $15.26 a share. You forecast four possible future economic conditions. Based on economic forecasts, you estimate that there is 15% probability of an economic boom, a 60% chance of normal economic conditions, 20% probability of an economic slowdown, and a 5% possibility of a recession. You expect the company to generate a 24% return during economic booms, 14% during normal conditions, 9% during economic slowdowns, and 6% during recessions.

A) Calculate your expected return on the stock (nearest 1/100 of one percent without % symbol, e.g. 6.98)?

B) Calculate the standard deviation for the stock (nearest 1/100 of one percent without % symbol, e.g. 6.98)?

Reference no: EM132957376

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Calculate your expected return on the stock

Reference no: EM132957376

Reference no: EM132957376

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